Ghana's FDI rises despite global financial turbulence

Accra, Oct. 16, GNA - Foreign Direct Investment to Ghana in the third quarter of the year, was over GH¢1.38 billion, representing an increase of 680 per cent over the same period in 2007, the Ghana Investment Promotion Centre (GIPC) said on Thursday. The corresponding figure for 2007 was GH¢175 million.

The new investments consist GH¢407.41 million worth of re-investments and GH¢972.10 million equity transfers for new projects registered during the quarter and existing investments. Key investments during the period included, the 70 per cent stake in Ghana Telecom by Vodafone with a value in excess of GH¢1.2 billion and Advans Ghana Savings and Loans Limited in the microfinance sector with an estimated project value of over GH¢8.8 million. A total of 82 projects were registered during the period out of which 51 were new wholly-owned foreign enterprises with the remaining 31 being joint venture projects between Ghanaians and their foreign partners.

The Joint venture projects were valued at GH¢914.36 million, whilst the 100 per cent foreign owned enterprises were valued at GH¢280.94 million.

The performance came in the face of the credit crunch sweeping across the world.

"We are confident that Ghana remains one of the best places to invest in the world today," Mr Robert Ahomka-Lindsay, Chief Executive of the GIPC said and added that the country had maintained its ranks among the top 90 countries in the world of doing business. "We are business-friendly, we have reduced the number of procedures to start a business, abolished the requirements to register employment vacancies and eliminated the previous requirement to obtain a company seal," he added.

However, Mr Ahomka-Lindsay said the impact of the credit crunch could be felt in the last quarter as companies, which were likely to seek expansion or relocate to Ghana, might delay their decisions because of financial constraints.

"This will mean that investments in the pipeline might not come in," he said.

The sectoral composition saw projects in the area of services topping the list with 28 projects, manufacturing had 13 and Agriculture four, among others.

Mr Ahomka-Lindsay said the country continued to make progress despite the global financial crisis and the aggressive pursuit of Foreign Direct Investment by other countries. He said the country was attracting investments into the critical areas of the economy necessary to sustain growth because of the overwhelming confidence in the Ghanaian economy and re-investment of existing companies.

India tops the list of countries with greater number of projects during the period. However, in terms of value of projects the Netherlands leads for the first time this year with investments of 1,287.56 million dollars.

Seven out of the ten regions benefited from the registered projects by way of their location with 84.15 per cent of the projects located in Greater Accra.

Over 4,631 jobs are expected to be generated from the projects with Ghanaians accounting for nearly 89.64 per cent of employment. Mr Ahomka-Lindsay said the Centre was making efforts to ensure fair and equitable distribution of projects across the regions. However, he said, investors continue to be attracted to Accra because of ready infrastructure and linkages.

"We are encouraging investors to venture into the regional centres and one way we can do this successfully is through agriculture and agri-business," he said.

He said GIPC would soon open offices in the regional centres as a means of attracting investors to the areas. 16 Oct. 08